Current Marketing Thoughts

Kevin Van Trump has over 20 years of experience in the grain and livestock industry.

Will High Bean Prices Force USDA's Hand?

Feb 24, 2014

Soybean producers following our lead should now be "100% SOLD" in old-crop. Our cash-sales target of $13.72, that had been in place for several months, was finally triggered. With more Chinese purchases either "rolling" to new-crop, "switching" to Brazilian origins or simply being "canceled," I have decided the stakes are just too high to continue holding old-crop bushels. I am also starting to hear more talk of Argentine framers releasing a bit more inventory. From my perspective, this should be played like the final round of "Double Jeopardy". Meaning this is an extremely tough question to answer and can make or break your earnings. With the Chinese crush margins falling apart and the Brazilian harvest moving right along, I am just not willing to bet much on this final question. With this in mind our objectives and focus now immediately switches to monitoring and looking for ways to reduce more risk and exposure in both the 2014 and 2015 crop years. I am not suggesting to race out and sell all of your anticipated new-crop production just yet, as there is still a strong bull story in play, especially when you consider US export commitments are already some 2 million metric tons more than the current USDA export estimate and we still have 7-months left in the marketing year. Point is the USDA has to either tighten the balance sheet even further or US soybean prices have to move even higher to encourage Chinese cancelations since we just don't have the bushels. The question remains, have we moved high enough to force their hand??? Click Here for my daily report....

When Does The Half-Time Show End For Old-Crop Soybeans?There is no question soymeal is the "Drum Major" (leader of the soybean marching band). I suspect not until the crowd clearly sees the band heading off the field and into the locker room will bullish traders stop cheering. Keep in mind meal has been the leader and continues to be the leader of this rally. Not until the trade is convinced Argentina can handle a larger portion of the demand requirements or that US crushers have enough supply to carry us through, will prices fall under much extreme pressure. I just don't want to be around when ....... Click here for my daily report....